DISTRIBUTION AGREEMENT
by and between
CRANE CO.
AND
HUTTIG BUILDING PRODUCTS, INC.
[ ], 1999
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS...................................................................................1
ARTICLE II THE DISTRIBUTION............................................................................10
Section 2.1 The Distribution.......................................................................10
Section 2.2 Cooperation Prior to the Distribution..................................................10
Section 2.3 Crane Board Action; Conditions to the Distribution.....................................11
Section 2.4 Waiver of Conditions...................................................................12
Section 2.5 Disclosure.............................................................................12
ARTICLE III TRANSACTIONS RELATING TO THE DISTRIBUTION..................................................12
Section 3.1 Intercorporate Transfers...............................................................12
Section 3.2 Crane Group Obligations Relating to the Building Products Business.....................13
Section 3.3 Company Group Obligations Relating to the Crane Group..................................14
Section 3.4 Intercompany Accounts and Arrangements.................................................15
Section 3.5 Cash Management........................................................................16
Section 3.6 The Company Board......................................................................16
Section 3.7 Resignations; Transfer of Stock Held as Nominee........................................16
Section 3.8 Rights Plan............................................................................17
Section 3.9 Insurance..............................................................................17
Section 3.10 Use of Names, Trademarks, etc.........................................................19
Section 3.11 Consents..............................................................................21
ARTICLE IV MUTUAL RELEASE; INDEMNIFICATION.............................................................22
Section 4.1 Mutual Release.........................................................................22
Section 4.2 Indemnification by Crane...............................................................22
Section 4.3 Indemnification by the Company.........................................................23
Section 4.4 Limitations on Indemnification Obligations.............................................24
Section 4.5 Procedures Relating to Indemnification.................................................24
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Section 4.6 Remedies Cumulative....................................................................27
Section 4.7 Survival of Indemnities................................................................27
Section 4.8 Exclusivity of Tax Allocation Agreement................................................27
ARTICLE V ACCESS TO INFORMATION........................................................................27
Section 5.1 Access to Information..................................................................27
Section 5.2 Production of Witnesses................................................................28
Section 5.3 Retention of Records...................................................................29
Section 5.4 Confidentiality........................................................................29
ARTICLE VI MISCELLANEOUS...............................................................................30
Section 6.1 Entire Agreement; Construction.........................................................30
Section 6.2 Survival of Agreements.................................................................30
Section 6.3 Expenses...............................................................................30
Section 6.4 Governing Law..........................................................................30
Section 6.5 Notices................................................................................31
Section 6.6 Consent to Jurisdiction................................................................31
Section 6.7 Amendments.............................................................................32
Section 6.8 Assignment.............................................................................32
Section 6.9 Captions; Currency.....................................................................32
Section 6.10 Severability..........................................................................32
Section 6.11 Parties in Interest...................................................................32
Section 6.12 Schedules.............................................................................33
Section 6.13 Termination...........................................................................33
Section 6.14 Waivers; Remedies.....................................................................33
Section 6.15 Further Assurances....................................................................33
Section 6.16 Counterparts..........................................................................33
Section 6.17 Performance...........................................................................33
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ANNEXES
Annex A - Employee Matters Agreement
Annex B - Tax Allocation Agreement
SCHEDULES
Schedule 1.1(b) - Company Subsidiaries
Schedule 1.1(c) - Huttig Bank Accounts
Schedule 1.1(d) - Huttig Financial Instruments
Schedule 1.1(e) - Huttig Litigation
Schedule 3.4(a)(i) - Intercompany Accounts
Schedule 3.4(b)(ii) - Intercompany Agreements
Schedule 3.5(c) - Funds Transfer Instructions
Schedule 3.7 - Continuing Directors and Officers
Schedule 4.2 - Certain Form 10 Sections
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DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT (this "Agreement"), dated as of [ ], 1999, by and
between CRANE CO., a Delaware corporation ("Crane"), and HUTTIG BUILDING
PRODUCTS, INC., a Delaware corporation and, as of the date hereof, an indirect
wholly owned subsidiary of Crane (the "Company").
WHEREAS, the Crane Board (as defined herein) has determined that it is
appropriate and desirable to distribute all outstanding shares of Huttig Common
Stock (as defined herein) on a pro rata basis to the holders of Crane Common
Stock (as defined herein); and
WHEREAS, Crane and the Company have determined that it is appropriate and
desirable to set forth the principal corporate transactions required to effect
such distribution and certain other agreements that will govern certain matters
relating to such distribution;
NOW, THEREFORE, in consideration of the premises and of the respective
agreements and covenants contained in this Agreement, the parties hereby agree
as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Acquisition Notes" shall have the meaning ascribed thereto in Section
3.1(b).
"Actions" means, with respect to any Person, any actual or threatened or
future action, suit, arbitration, inquiry, proceeding or investigation by or
before any Governmental Entity or any claims or other legal matters that have
been or may be asserted by or against, or otherwise affect, such Person.
"Affiliate" means, with respect to any specified Person, any other Person
that directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person; provided,
however, that for purposes of this Agreement, following the Time of Distribution
no member of either Group shall be deemed to be an Affiliate of any member of
the other Group. For purposes of the immediately preceding sentence, the term
"control" (including, with correlating meanings, the terms "controlled by" and
"under common control with"), as used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through
ownership of voting securities, by contract or otherwise.
"Agreement" shall have the meaning ascribed thereto in the preamble.
"Ancillary Agreements" means, collectively, the Employee Matters Agreement
and the Tax Allocation Agreement.
"Assets" means any and all assets, properties and rights, whether tangible
or intangible, real, personal or mixed, fixed, contingent or otherwise, and
wherever located (other than ownership interests in Subsidiaries).
"Assigning Party" shall have the meaning ascribed thereto in Section 3.11.
"Building Products Business" means (i) the business engaged in at all times
prior to the Time of Distribution by the Company Group of distribution and
manufacturing of doors, windows, millwork and other building products and
activities related thereto, and (ii) Former Businesses managed or operated with
any of the foregoing or operationally or otherwise related to any of the
foregoing.
"Cash" means all cash, cash on hand, cash in transit, cash equivalents,
funds, certificates of deposit, similar instruments and other short-term
investments held by Crane and its Subsidiaries and Affiliates (including,
without limitation, members of the Company Group) at the Time of Distribution
(it being understood that cash equivalents do not include intercompany cash
management balances which will be eliminated as of the Time of Distribution
pursuant to Section 3.4(a)).
"Change in Control" means, with respect to any party, any of the following
events or circumstances: (a) the first purchase of shares pursuant to a tender
offer or exchange offer for all or part of that party's common stock or any
securities convertible into such common stock, (b) the receipt by that party of
a Schedule 13D or other advice indicating that a Person is the "beneficial
owner" (as that term is defined in Rule 13d-3 under the Securities Exchange Act
of 1934, as amended) of 20% or more of that party's common stock calculated as
provided in paragraph (d) of said Rule 13d-3, (c) the date of approval by
stockholders of that party of an agreement providing for any consolidation or
merger of that party in which that party will not be the continuing or surviving
corporation or pursuant to which shares of common stock of that party would be
converted into cash, securities or other property, other than a merger of that
party in which the holders of its common stock immediately prior to the merger
would have the same proportion of ownership of common stock of the surviving
corporation immediately after the merger, (d) the date of the approval by
stockholders of that party of any sale, lease, exchange or other transfer (in
one transaction or a series of related transactions) of all or substantially all
the assets of that party, (e) the adoption of any plan or proposal for the
liquidation (but not a partial liquidation) or dissolution of that party, or (f)
the date on which Continuing Directors cease for any reason to constitute at
least a majority of the board of directors of that party.
"Claims Administration" means the processing of claims made under the
Policies, including, without limitation, the reporting of claims to the
insurance carrier, management and defense of claims, and providing for
appropriate releases upon settlement of claims.
"Claims Made Policies" shall have the meaning ascribed thereto in Section
3.9(a).
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor legislation.
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"Commission" means the Securities and Exchange Commission.
"Company" shall have the meaning ascribed thereto in the preamble.
"Company Board" means the Board of Directors of the Company.
"Company Group" means the Company and the Company Subsidiaries.
"Company Subsidiary" means each Person listed on Schedule 1.1(b) which is a
direct or indirect Subsidiary of the Company as of the Time of Distribution.
"Consents" means consents, approvals, waivers, clearances, exemptions,
allowances, novations, authorizations, filings, registrations and notifications.
"Continuing Director" means, with respect to either party, any member of
such party's board of directors who either (i) is a member of such board as of
the Time of Distribution or (ii) is thereafter elected to such board, or
nominated for election by stockholders, by a vote of at least three-quarters of
the directors who are Continuing Directors at the time of such vote.
"Contracts" means agreements, leases, contracts, memoranda of
understanding, letters of intent, sales orders, purchase orders, open bids and
other commitments and all rights therein and Liabilities thereunder, including,
without limitation, in each case, all amendments, modifications and supplements
thereto and waivers and consents thereunder.
"Crane" shall have the meaning ascribed thereto in the preamble.
"Crane Assets" means, collectively, all Assets which immediately prior to
the Time of Distribution are owned by Crane or any of its Subsidiaries
(including, without limitation, members of the Company Group), other than the
Huttig Assets. Anything contained herein to the contrary notwithstanding, Crane
Retained Assets shall be included in Crane Assets.
"Crane Board" means the Board of Directors of Crane or a duly authorized
committee thereof.
"Crane Common Stock" means the Common Stock, par value $1.00 per share, of
Crane.
"Crane Financial Instruments" means all credit facilities, guaranties,
foreign currency forward exchange contracts, comfort letters, letters of credit
and similar instruments related to the Crane Group obligations under which any
member of the Company Group has any primary, secondary, contingent, joint,
several and other liability.
"Crane Group" means Crane and its Affiliates, whether now or hereafter
existing, other than members of the Company Group.
"Crane Indemnitees" means Crane, each Affiliate of Crane, including the
Crane Subsidiaries, each of their respective Representatives and each of the
heirs, executors, successors and assigns of any of the foregoing.
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"Crane International" means Crane International Holdings, Inc., a Delaware
corporation and a wholly-owned subsidiary of Crane.
"Crane Retained Accounts" means all bank accounts of Crane and its
Subsidiaries and Affiliates (including, without limitation, members of the
Company Group), other than Huttig Bank Accounts.
"Crane Retained Assets" means the following:
(i) all (A) Crane Retained Accounts and (B) Cash, including, without
limitation, all Cash contained in the Crane Retained Accounts;
(ii) all Policies and all rights therein and related thereto, other
than the benefits of Occurrence Basis Policies and Claims Made Policies to
the extent described in Section 3.8(a);
(iii) all rights in and use of the name, trademark, trade name and
service xxxx "Xxxxx" and all corporate symbols and logos related thereto
and all names, trademarks, trade names and service marks which include the
word "Crane" or any derivative thereof (other than as provided for in
Section 3.9);
(iv) all assets with respect to pension plans of Crane and its
Subsidiaries (including, without limitation, members of the Company Group);
(v) all assets that are used by Crane and its Subsidiaries and
Affiliates in providing corporate, insurance and administrative services to
Subsidiaries, divisions or operating units of the Crane Group not included
in the Building Products Business (whether or not the same or similar
services are provided to the Building Products Business); and
(vi) all rights, choses in action, causes of action and claims arising
out of any asset described in clauses (i) through (v) above.
"Crane Subsidiary" means any Subsidiary of Crane other than the Company or
any Company Subsidiary.
"Declaration" means the declaration of the Distribution by the Crane Board.
"Debt Financing" means (i) a working capital facility of $30 million or
such other amount as the Company Board shall determine to be necessary or
desirable for the Company, (ii) an acquisitions facility of $20 million or such
other amount as the Company Board shall determine to be necessary or desirable
for the Company and (iii) a credit facility or other credit arrangement to lend
such additional amount as shall be consistent with a rating of not less than
NAIC-2 for the Company's indebtedness.
"Distribution" means the distribution, on the basis provided for in Section
2.11, to holders of Crane Common Stock of the shares of Huttig Common Stock
owned by Crane on the Distribution Date.
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"Distribution Agent" means ChaseMellon Shareholder Services, L.L.C. in its
capacity as the agent selected by Crane to distribute Huttig Common Stock in
connection with the Distribution.
"Distribution Date" means the date determined by the Crane Board as the
date on which the Distribution will be effected.
"Employee Matters Agreement" means the Employee Matters Agreement between
Crane and the Company, substantially in the form attached hereto as Annex A,
with such changes as are permitted under the terms of the Exchange Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Agreement" means the Share Exchange Agreement dated as of October
19, 1999 among Crane, the Company and Rugby pursuant to which, following the
Distribution, Rugby will contribute to the Company all of the issued and
outstanding capital stock of Rugby USA in exchange for a number of new shares of
Huttig Common Stock.
"Form 10" means the registration statement on Form 10 filed by the Company
with the Commission to effect the registration of the Huttig Common Stock
pursuant to the Exchange Act, including, without limitation, all amendments
thereto filed by the Company with the Commission prior to the Time of
Distribution.
"Former Business" means any corporation, partnership, entity, division,
business unit, business, assets, plants, product line, operations or contract
(including, without limitation, any assets and liabilities comprising the same)
that has been sold, conveyed, assigned, transferred or otherwise disposed of or
divested (in whole or in part) by any member of the Pre-Distribution Group or
the operations, activities or production of which has been discontinued,
abandoned, completed or otherwise terminated (in whole or in part) by any member
of the Pre-Distribution Group.
"Governmental Entity" means any government or any court, arbitral tribunal,
administrative agency or commission or other governmental or regulatory
authority or agency, whether Federal, state, local, domestic, foreign or
international.
"Group" means the Crane Group or the Company Group, as the context
requires.
"Huttig Assets" means, collectively, all Assets (other than Crane Retained
Assets) which immediately prior to the Time of Distribution are owned by Crane
or any of its Subsidiaries (including, without limitation, members of the
Company Group) and which are used primarily in or relate primarily to the
Building Products Business, as the same shall exist as of such time, including,
without limitation, (except as otherwise provided pursuant to any Transaction
Agreement) all assets reflected in the Huttig Balance Sheet, as such assets may
have been added to or sold or otherwise changed since the date thereof.
"Huttig Balance Sheet" means the balance sheet of the Company as of
September 30, 1999 contained in the Form 10.
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"Huttig Bank Accounts" means all bank accounts set forth on Schedule
1.1(c).
"Huttig Common Stock" means, collectively, the Common Stock, par value $.01
per share, of the Company and the related Rights.
"Huttig Financial Instruments" means all credit facilities, guaranties,
foreign currency forward exchange contracts, comfort letters, letters of credit
and similar instruments related to the Building Products Business under which
any member of the Crane Group has any primary, secondary, contingent, joint,
several or other Liability, including, without limitation, those set forth on
Schedule 1.1(d).
"Huttig Indemnitees" means the Company, each Affiliate of the Company,
including the Company Subsidiaries, each of their respective Representatives and
each of the heirs, executors, successors and assigns of any of the foregoing.
"Huttig Liabilities" means (i) all Liabilities of any member of the Company
Group under any Transaction Agreement to which it is or becomes a party, (ii)
all Liabilities for which any member of the Company Group is made responsible
pursuant to any Transaction Agreement and (iii) all Liabilities based upon,
arising out of, relating to or otherwise in connection with the Huttig Assets or
the Building Products Business, whether based upon, arising out of, relating to
or otherwise in connection with events, actions, occurrences, omissions,
circumstances or conditions occurring, existing or asserted before, at or after
the Time of Distribution, including, without limitation: (A) all Liabilities
reflected (or of the type reflected) on the Huttig Balance Sheet or described
(or of the type described) in the notes thereto (as such Liabilities may have
been reduced or added to or otherwise changed since the date thereof), (B) all
Liabilities in respect of checks outstanding as of the Time of Distribution
relating to the Building Products Business, (C) all Liabilities in respect of
workers' compensation, automobile, general liability, products liability,
intellectual property liability and other claims and matters (whether direct or
by indemnification of any Person or otherwise) relating to the Building Products
Business, (D) all Liabilities in respect of all Actions relating to the Building
Products Business, including, without limitation, those Actions set forth on
Schedule 1.1(e), (E) all Liabilities in respect of salary, bonuses, incentive
payments, severance payments and other compensation payments for current or
former employees of the Building Products Business and all Taxes and
withholdings related thereto, (F) except for those Liabilities expressly assumed
by the Crane Group pursuant to the Employee Matters Agreement, all Liabilities
in respect of employee welfare and fringe benefits relating to the Building
Products Business (including, without limitation, claims for medical and
disability benefits), (G) all Liabilities for environmental matters based upon,
arising out of, relating to or otherwise in connection with the Building
Products Business, including, without limitation, Liabilities in respect of any
facility to the extent relating to the Building Products Business presently or
formerly owned or operated by any member of the Pre-Distribution Group, (H) all
Liabilities based upon, arising out of, relating to or otherwise in connection
with Contracts related to the Building Products Business, including, without
limitation, Liabilities to make payments or otherwise in connection with the
termination thereof as a result of the transactions contemplated hereby or
otherwise, and (I) all Liabilities relating to the credit facilities and other
debt instruments to which any member of the Company Group is a party at the
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Time of Distribution, including, without limitation, all indebtedness
outstanding thereunder and interest and fees payable with respect thereto.
"Indemnifiable Losses" means, subject to Section 4.4, any and all losses,
Liabilities, claims, damages, deficiencies, obligations, fines, payments, Taxes,
Liens, costs and expenses, matured or unmatured, absolute or contingent, accrued
or unaccrued, liquidated or unliquidated, known or unknown, whenever arising and
whether or not resulting from Third Party Claims (including, without limitation,
the costs and expenses of any and all Actions; all amounts paid in connection
with any demands, assessments, judgments, settlements and compromises relating
thereto; interest and penalties recovered by a third party with respect thereto;
out-of-pocket expenses and reasonable attorneys', accountants' and other
experts' fees and expenses reasonably incurred in investigating, preparing or
defending against any such Actions or in asserting, preserving or enforcing an
Indemnitee's rights hereunder; and any losses that may result from the granting
of injunctive relief as a result of any such Actions).
"Indemnifying Party" shall have the meaning ascribed thereto in Section
4.4.
"Indemnitee" means any of the Crane Indemnitees or the Huttig Indemnitees
who or which may seek indemnification under this Agreement.
"Indemnity Reduction Amounts" shall have the meaning ascribed thereto in
Section 4.4(a).
"Information" means all records, books, contracts, instruments, computer
data and other data and information (in each case, in whatever form or medium,
including, without limitation, electronic media).
"Information Statement" means the information statement sent to the holders
of Crane Common Stock in connection with the Distribution.
"Insurance Proceeds" means monies (a) received by an insured from an
insurance carrier, (b) paid by an insurance carrier on behalf of an insured or
(c) received from any third party in the nature of insurance, contribution or
indemnification in respect of any Liability.
"IRS" means the Internal Revenue Service.
"Liabilities" means any and all claims, debts, liabilities, commitments and
obligations of whatever nature, whether fixed, contingent or absolute, matured
or unmatured, liquidated or unliquidated, accrued or not accrued, known or
unknown, due or to become due, whenever or however arising (including, without
limitation, those arising out of any contract or tort, whether based on
negligence, strict liability or otherwise) and whether or not the same would be
required by generally accepted accounting principles to be reflected as a
liability in financial statements or disclosed in the notes thereto, including,
without limitation, all costs and expenses relating thereto and those claims,
debts, liabilities, commitments and obligations arising under any law, rule,
regulation, Action, order or consent decree of any Governmental Entity or any
award of any arbitrator of any kind, and those arising under any Contract.
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"Licenses" means licenses, permits, authorizations, consents, certificates,
registrations, variances, franchises and other approvals from any Governmental
Entity, including, without limitation, those relating to environmental matters.
"Lien" means any lien, security interest, pledge, mortgage, charge,
restriction, claim, retention of title agreement or other encumbrance of
whatever nature.
"NYSE" means the New York Stock Exchange, Inc.
"Occurrence Basis Policies" shall have the meaning ascribed thereto in
Section 3.8(a).
"Ordinary Course Intercompany Arrangements" shall have the meaning ascribed
thereto in Section 3.3(b)(ii).
"Parent Note" shall have the meaning ascribed thereto in Section 3.1(b).
"Person" means any individual, partnership, joint venture, corporation,
limited liability entity, trust, unincorporated organization or other entity
(including, without limitation, a Governmental Entity).
"Policies" means all insurance policies and insurance contracts of any kind
of the Pre-Distribution Group which include the Company, the Company
Subsidiaries and/or the Building Products Business within the definition of the
named insured and which were or are in effect at any time at or prior to the
Time of Distribution, including, without limitation, primary, excess and
umbrella policies, commercial general liability policies, fiduciary liability,
product liability, automobile, aircraft, property and casualty, directors and
officers liability, workers' compensation and employee dishonesty insurance
policies, bonds and captive insurance company arrangements, together with all
rights, benefits and privileges thereunder.
"Pre-Distribution Group" means (i) each of Crane, the Crane Subsidiaries
existing immediately prior to the Time of Distribution (including, without
limitation, members of the Company Group) and the former Crane Subsidiaries,
(ii) each of the predecessors of each of the foregoing and (iii) each of the
present and former Subsidiaries and other Affiliates of each of the foregoing,
and their predecessors.
"Privileged Information" means, with respect to either Group, Information
regarding a member of such Group, or any of its operations, employees, assets or
Liabilities (whether in documents or stored in any other form or known to its
employees or agents) that is or may be protected from disclosure pursuant to the
attorney-client privilege, the work product doctrine or other applicable
privileges, that a member of the other Group may come into possession of or
obtain access to pursuant to this Agreement or otherwise.
"Recipient Party" shall have the meaning ascribed thereto in Section 3.10.
"Record Date" means the close of business on the date determined by the
Crane Board as the record date for the Distribution.
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"Representative" means, with respect to any Person, any of such Person's
directors, officers, employees, agents, consultants, advisors, accountants,
attorneys and representatives.
"Rights" means the Rights to be issued pursuant to the Rights Plan.
"Rights Plan" means the rights agreement entered into on or prior to the
Distribution Date between the Company and ChaseMellon Shareholder Services,
L.L.C., as rights agent, substantially in the form filed as an exhibit to the
Form 10.
"Rugby" means The Rugby Group PLC, a company registered in England and
Wales under company number 206971.
"Rugby USA" means Rugby USA, Inc., a Georgia corporation and a wholly owned
subsidiary of Rugby.
"Securities Act" means the Securities Act of 1933, as amended.
"Share Exchange" means the exchange by Rugby of all of the issued and
outstanding capital stock of Rugby USA for, among other things, a number of new
shares of Huttig Common Stock, as contemplated by the Exchange Agreement.
"Subsidiary" means, with respect to any Person, any corporation or other
organization, whether incorporated or unincorporated, of which such Person or
any Subsidiaries of such Person controls or owns, directly or indirectly, more
than 50% of the stock or other equity interest, or more than 50% of the voting
power entitled to vote on the election of members to the board of directors or
similar governing body; provided, however, that for purposes of this Agreement
neither the Company nor any Company Subsidiary shall be deemed to be a Crane
Subsidiary (as defined herein).
"Tax" shall have the meaning ascribed thereto in the Tax Allocation
Agreement.
"Tax Allocation Agreement" means the Tax Allocation Agreement between Crane
and the Company, substantially in the form attached hereto as Annex B, with such
changes as are permitted under the terms of the Exchange Agreement.
"Tax Ruling" means a private letter ruling issued by the IRS in form and
substance satisfactory to Crane (in its sole discretion) indicating that the
Distribution will qualify as a tax-free spin-off to the stockholders of Crane
for federal income tax purposes under Section 355 of the Code.
"Third Party Claim" shall have the meaning ascribed thereto in Section
4.5(a).
"Time of Distribution" means 12:01 a.m., New York City time, on the
Distribution Date.
"Transaction Agreements" means, collectively, this Agreement and each
Ancillary Agreement.
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ARTICLE II
THE DISTRIBUTION
Section 2.1 The Distribution.
(a) Subject to Section 2.3, on or prior to the Distribution Date,
Crane will deliver to the Distribution Agent, for the benefit of holders of
record of Crane Common Stock as of the Record Date, a certificate or
certificates, endorsed by Crane in blank, representing, in the aggregate
(and rounded up to the nearest whole share), a number of shares of Huttig
Common Stock equal to the number of shares of Crane Common Stock issued and
outstanding as of the Record Date (excluding treasury shares held by Crane)
divided by 4.5, and Crane will instruct the Distribution Agent to make
book-entry credits on the Distribution Date or as soon thereafter as
practicable for each holder of record of Crane Common Stock as of the
Record Date, or the designated transferee or transferees of such holder,
for a number of shares (including fractional shares) of Huttig Common Stock
equal to the quotient obtained by dividing (i) the number of shares of
Crane Common Stock so held by such holder of record as of the Record Date
divided by (ii) 4.5. The Distribution will be effective as of the Time of
Distribution.
(b) Crane and the Company will each provide to the Distribution Agent
all information (including, without limitation, information necessary to
make appropriate book-entry credits) and share certificates, in each case,
as may be required in order to complete the Distribution on the basis of
one share of Huttig Common Stock for every 4.5 shares of Crane Common Stock
issued and outstanding as of the Record Date (excluding treasury shares
held by Crane).
Section 2.2 Cooperation Prior to the Distribution. Prior to the
Distribution:
(a) Crane and the Company will prepare, and Crane will mail, promptly
after effectiveness of the Form 10, to the holders of Crane Common Stock,
the Information Statement, which will set forth appropriate disclosures
concerning the Company, the Distribution, Rugby USA, the Share Exchange and
such other matters as Crane and the Company may determine. Crane and the
Company will prepare, and the Company will file with the Commission, the
Form 10, which will include or incorporate by reference the Information
Statement. The Company will use its reasonable best efforts to cause the
Form 10 to become effective under the Exchange Act as soon as practicable
following the filing thereof.
(b) Crane and the Company will cooperate in preparing, filing with the
Commission and causing to become effective any registration statements or
amendments thereof which are required to reflect the establishment of, or
amendments to, any employee benefit and other plans contemplated by the
Employee Matters Agreement.
(c) Crane and the Company will take all such action as may be
necessary or appropriate under the securities or "blue sky" laws of the
states or other political subdivisions of
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the United States and the securities laws of any applicable foreign countries or
other political subdivisions thereof in connection with the transactions
contemplated by this Agreement.
(d) Crane and the Company will cause to be prepared, and the Company
will file and use its reasonable best efforts to have approved, an
application for listing on the NYSE the Huttig Common Stock to be
distributed in the Distribution.
Section 2.3 Crane Board Action; Conditions to the Declaration. The
Crane Board will, in its discretion and, if applicable, consistent with the
Exchange Agreement, establish the Record Date and make the Declaration and
establish all appropriate procedures in connection with the Distribution, but in
no event will the Declaration occur prior to such time as each of the following
conditions shall have been satisfied or shall have been waived by the Crane
Board in accordance with Section 2.4:
(a) Crane shall have received the Tax Ruling and the Tax Ruling shall
be in full force and effect;
(b) All applicable waiting periods under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended, shall have been terminated
or expired;
(c) Crane shall have received copies of commitments for the Debt
Financing in form and substance satisfactory to Crane;
(d) all material Consents of Governmental Entities that are required
to effect the Distribution, if applicable, and the Share Exchange shall
have been obtained, where the failure to obtain such Consents, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect on the Company (within the meaning of the Exchange
Agreement) or a Material Adverse Effect on Rugby USA (within the meaning of
the Exchange Agreement);
(e) the Form 10 shall have become effective under the Exchange Act and
no stop order suspending the effectiveness of the Form 10 shall have been
issued, and no proceedings for that purpose shall have been initiated or
threatened by the Commission;
(f) the Huttig Common Stock shall have been approved for listing on
the NYSE, subject to official notice of issuance;
(g) the Requisite Rugby Vote (within the meaning of the Exchange
Agreement) shall have been obtained; and
(h) no order shall have been entered and shall have remained in effect
in any action or proceeding before any Governmental Entity that would
prohibit or make illegal the Distribution or the Exchange;
provided that the satisfaction of such conditions will not create any obligation
on the part of Crane pursuant to this Agreement to effect or seek to effect the
Distribution or in any way limit
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Crane's right to terminate this Agreement as set forth in Section 6.13 or alter
the consequences of any such termination from those specified in such Section.
Section 2.4 Waiver of Conditions. Any or all of the conditions set forth in
Section 2.3 may be waived, in whole or in part, in the sole discretion of the
Crane Board.
Section 2.5 Disclosure. If at any time after the date hereof either of the
parties shall become aware of any circumstances that will or may prevent any or
all of the conditions contained in Section 2.3 from being satisfied, it will
promptly give to the other party written notice of those circumstances.
ARTICLE III
TRANSACTIONS RELATING TO THE DISTRIBUTION
Section 3.1 Intercorporate Transfers.
(a) Prior to the Distribution Date, Crane and the Company will take
all actions necessary to cause all of the outstanding shares of Huttig
Common Stock to be distributed by Crane International to Crane and to
increase the outstanding shares of Huttig Common Stock so that, immediately
prior to the Distribution, Crane will hold a number of shares of Huttig
Common Stock (rounded up to the nearest whole share) equal to the number of
shares of Crane Common Stock issued and outstanding as of the Record Date
(excluding treasury shares held by Crane) divided by 4.5.
(b) Prior to the Time of Distribution, the Company will (i) arrange
the Debt Financing, (ii) pay to Crane (from time to time and on the day
prior to the Distribution Date) in reduction of intercompany indebtedness
the Company's net cash balances on hand, (iii) on the day prior to the
Distribution Date, issue to Crane a Note (the "Parent Note") in a principal
amount equal to the Parent Cash Amount (as defined in the Exchange
Agreement) in exchange for a like principal amount of existing indebtedness
and (iv) from time to time upon advances by Crane to fund acquisitions,
issue notes in the principal amount (not to exceed an aggregate of $15
million) of such advances (the "Acquisition Notes"). On the day prior to
the Distribution Date, subsequent to effecting (iv) above, contribute or
cause to be contributed to the capital of the Company or otherwise settle
or eliminate as provided in Section 3.3(a) all indebtedness of the Company
to Crane, other than the Parent Note and the Acquisition Notes.
(c) The parties acknowledge that the Company Group currently is
conducting the Building Products Business and that all or substantially all
of the Huttig Assets and Huttig Liabilities are owned or are obligations of
members of the Company Group. Pursuant to the Distribution, the Huttig
Assets and Huttig Liabilities are intended to be allocated entirely to the
Company Group and the Crane Assets and Liabilities of Crane, and any Crane
subsidiary are intended to be allocated entirely to the Crane Group.
Accordingly, in the event that at any time or from time to time (whether
prior to or after the Time of Distribution) either party (or any member of
such party's respective Group) shall receive or otherwise possess any Asset
that is allocated to any other Person pursuant to this Agreement or any
Ancillary Agreement, such party
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will promptly transfer, or cause to be transferred, such Asset to the
Person so entitled thereto. Prior to any such transfer, the Person
receiving or possessing such Asset will hold such Asset in trust for the
benefit of the Person entitled thereto (at the expense of the Person
entitled thereto). If at any time or from time to time (whether prior to or
after the Time of Distribution) either Crane or the Company determines that
the other party (or any member of such other party's respective Group)
shall not have unconditionally assumed any Liabilities that are allocated
to such other party (or a member of such other party's respective Group)
pursuant to this Agreement or any Ancillary Agreement, such other party
will promptly execute and deliver, or cause to be executed and delivered,
all such documents and instruments and will take, or cause to be taken, all
such actions as the requesting party may reasonably request to
unconditionally assume, or cause to be unconditionally assumed, such
Liabilities.
(d) Each of Crane (on behalf of itself and each member of the Crane
Group) and the Company (on behalf of itself and each member of the Company
Group) understands and agrees that, except as expressly set forth in the
Exchange Agreement or any Transaction Agreement, no party to any
Transaction Agreement or any other agreement or document contemplated by
any Transaction Agreement either has represented or warranted, or is
representing or warranting in any way, in such agreement or otherwise, (i)
as to the Assets, Subsidiaries, businesses or Liabilities owned at the date
hereof by such party or retained, transferred or assumed as contemplated
hereby or thereby, (ii) as to any consents or approvals required in
connection with the transactions contemplated by the Transaction
Agreements, (iii) as to the value or freedom from any Lien of, or any other
matter concerning, any Assets or Subsidiaries of either party, or (iv) as
to the absence of any defenses or rights of setoff or freedom from
counterclaim with respect to any claim or other Assets or Subsidiaries of
either party. Except as may expressly be set forth in any Transaction
Agreement, all Assets and Subsidiaries owned at the date hereof or being
transferred or retained as contemplated by any Transaction Agreement or any
other agreement or document contemplated by any Transaction Agreement are
held, or are being transferred or retained, on an "as is", "where is" basis
and the respective owners or transferees shall bear the economic and legal
risks that the title to any Asset or Subsidiary shall be other than good
and marketable and free and clear of any Lien.
Section 3.2 Crane Group Obligations Relating to the Building Products
Business.
(a) The Company will, at its expense, take or cause to be taken all
commercially reasonable actions and enter into (or cause its Subsidiaries
to enter into) such agreements and arrangements as shall be necessary to
effect the release of and substitution for each member of the Crane Group,
effective as of the Time of Distribution, from all primary, secondary,
contingent, joint, several and other Liabilities in respect of Huttig
Financial Instruments (it being understood that all Liabilities in respect
of Huttig Financial Instruments are Huttig Liabilities). The Company will
reimburse Crane for any reimbursements made by Crane pursuant to any Huttig
Financial Instruments and that remain outstanding at the Distribution Date.
(b) The Company will, at its expense, use its reasonable best efforts
to take or cause to be taken all actions and to enter into (or cause its
Subsidiaries to enter into) such agreements and arrangements as shall be
necessary to effect the release of and substitution for
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each member of the Crane Group, effective as of the Time of Distribution,
from all primary, secondary, contingent, joint, several and other
Liabilities in respect of bonds, indemnities, assurances and Contracts
(other than the Exchange Agreement and Huttig Financial Instruments, which
are covered by paragraph (a) above) under which any member of the Crane
Group has any primary, secondary, contingent, joint, several or other
Liability arising out of or relating to the Building Products Business
which by their terms will be outstanding or in effect as of or at any time
following the Time of Distribution; provided, however, that the Company
shall not be obligated to pay any consideration therefor to any third party
(it being understood that all Liabilities in respect of such bonds,
indemnities, assurances and Contracts are Huttig Liabilities).
(c) The Company's obligations under this Section 3.2 will continue to
be applicable to all Huttig Financial Instruments, bonds, indemnities,
assurances and Contracts identified at any time by Crane, whether before,
at or after the Time of Distribution.
Section 3.3 Company Group Obligations Relating to the Crane Group.
(a) Crane will, at its expense, take or cause to be taken all
commercially reasonable actions and enter into (or cause its Subsidiaries
to enter into) such agreements and arrangements as shall be necessary to
effect the release of and substitution for each member of the Company
Group, effective as of the Time of Distribution, from all primary,
secondary, contingent, joint, several and other Liabilities in respect of
Crane Financial Instruments (it being understood that all Liabilities in
respect of Crane Financial Instruments are Liabilities of Crane or its
Subsidiaries).
(b) Crane will, at its expense, use its reasonable best efforts to
take or cause to be taken all actions and to enter into (or cause its
Subsidiaries to enter into) such agreements and arrangements as shall be
necessary to effect the release of and substitution for each member of the
Company Group, effective as of the Time of Distribution, from all primary,
secondary, contingent, joint, several and other Liabilities in respect of
bonds, indemnities, assurances and Contracts (other than the Exchange
Agreement and Crane Financial Instruments, which are covered by paragraph
(a) above) under which any member of the Company Group has any primary,
secondary, contingent, joint, several or other Liability arising out of or
relating to businesses of the Pre-Distribution Group other than the
Building Products Business which by their terms will be outstanding or in
effect as of or at any time following the Time of Distribution; provided,
however, that Crane shall not be obligated to pay any consideration
therefor to any third party (it being understood that all Liabilities in
respect of such bonds, indemnities, assurances and Contracts are
Liabilities of Crane or its Subsidiaries).
(c) Crane's obligations under this Section 3.3 will continue to be
applicable to all Crane Financial Instruments, bonds, indemnities,
assurances and Contracts identified at any time by the Company, whether
before, at or after the Time of Distribution.
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Section 3.4 Intercompany Accounts and Arrangements.
(a) Elimination of Intercompany Accounts.
(i) Except as set forth in Section 3.4(a)(ii) or on Schedule
3.4(a)(i) and except for the Parent Note and the Acquisition Notes,
the Company, on behalf of itself and each other member of the Company
Group, on the one hand, and Crane, on behalf of itself and each other
member of the Crane Group, on the other hand, hereby agree to settle
and eliminate, by cancellation or transfer to a member of the other
Group (whether to cancel or transfer and the manner thereof will be
determined by Crane), effective immediately prior to the Time of
Distribution, all intercompany receivables, payables and other
balances (including, without limitation, intercompany loans and cash
management balances) between the Company and/or any Company
Subsidiary, on the one hand, and Crane and/or any Crane Subsidiary, on
the other hand.
(ii) The provisions of Section 3.4(a)(i) will not apply to any
intercompany receivables, payables and other balances incurred in
connection with the payment by any party of any expenses which are
required to be paid by the other party pursuant to Section 6.3.
(b) Intercompany Agreements.
(i) Except as set forth in Section 3.4(b)(ii), in furtherance of
the releases and other provisions of Section 4.1, the Company, on
behalf of itself and each other member of the Company Group, on the
one hand, and Crane, on behalf of itself and each other member of the
Crane Group, on the other hand, hereby terminate any and all
agreements, arrangements, commitments or understandings in existence
as of the Time of Distribution, whether or not in writing, between or
among the Company and/or any Company Subsidiary, on the one hand, and
Crane and/or any Crane Subsidiary, on the other hand, effective as of
the Time of Distribution. No such terminated agreement, arrangement,
commitment or understanding (including, without limitation, any
provision thereof which purports to survive termination) shall be of
any further force or effect after the Time of Distribution.
(ii) The provisions of Section 3.4(b)(i) will not apply to any of
the following agreements, arrangements, commitments or understandings
(or to any of the provisions thereof): (A) the Transaction Agreements
(and each other agreement, instrument or document expressly
contemplated by any Transaction Agreement to be entered into by any of
the parties hereto or any of the members of their respective Group);
(B) any agreement, arrangement, commitment or understanding relating
to any matter described in Section 3.4(a)(ii); (C) any agreements,
arrangements, commitments or understandings listed or described on
Schedule 3.4(b)(ii); (D) any agreements, arrangements, commitments or
understandings to which any Person other than the parties hereto and
their respective Affiliates is a party; (E) any other agreements,
arrangements, commitments or understandings that any of the
Transaction Agreements expressly contemplates will survive the Time of
Distribution; (F) the Exchange Agreement; and (G) any agreements,
arrangements, commitments or understandings between the Company and/or
any Company Subsidiary, on the one hand, and Crane and/or any Crane
Subsidiary, on the other hand, for the purchase or sale of goods or
services of a type which the provider thereof provides to unaffiliated
third parties in the ordinary course of business ("Ordinary Course
Intercompany Arrangements"); provided, however, that in the event any
such Ordinary Course Intercompany Arrangements do not, as of the Time
of Distribution, contain
-15-
commercially reasonable arm's-length terms of a type to which
unaffiliated parties would reasonably agree or do not include terms
which would normally appear in such arrangements between unaffiliated
parties, Crane and the Company will cause such Ordinary Course
Intercompany Arrangements to be amended so that they will contain
terms which are, as of the Time of Distribution, commercially
reasonable arm's-length terms of a type to which unaffiliated parties
would reasonably agree.
Section 3.5 Cash Management.
(a) Bank Accounts. All Huttig Bank Accounts will constitute Huttig
Assets and all Crane Retained Accounts will constitute Crane Assets.
(b) Crane Customer Payments. The Company will, and will cause its
Subsidiaries and Affiliates to, forward promptly to Crane (for the account
of Crane or its applicable Subsidiary) any customer payments in respect of
accounts receivable owed to any member of the Crane Group received by the
Company or any of its Subsidiaries or Affiliates after the Time of
Distribution, whether received in lock boxes, via wire transfer or
otherwise. Such amounts will be forwarded by wire transfer (to Crane's bank
account at ___________________, Account No. ________) in the case of
customer payments received within thirty days after the Distribution Date
and by check in the case of customer payments received thereafter.
(c) Company Customer Payments. Crane will, and will cause its
Subsidiaries and Affiliates to, forward promptly to the Company (for the
account of the Company or its applicable Subsidiary) any customer payments
in respect of accounts receivable owed to any member of the Company Group
received by Crane or any of its Subsidiaries or Affiliates after the Time
of Distribution, whether received in lock boxes, via wire transfer or
otherwise. Such amounts will be forwarded by wire transfer in the case of
customer payments received within thirty days after the Distribution Date
and by check in the case of customer payments received thereafter.
Section 3.6 The Company Board. The Company and Crane will take all
actions which may be required to elect or otherwise appoint as directors of the
Company, prior to the Time of Distribution, the persons named in the Form 10 to
constitute the Company Board at the Time of Distribution.
Section 3.7 Resignations; Transfer of Stock Held as Nominee.
(a) Crane will cause all of its employees and directors and all of the
employees and directors of each other member of the Crane Group to resign,
not later than the Time of Distribution, from all boards of directors or
similar governing bodies of the Company or any other member of the Company
Group on which they serve, and from all positions as officers of the
Company or any other member of the Company Group in which they serve,
except as otherwise specified on Schedule 3.7. The Company will cause all
of its employees and directors and all of the employees and directors of
each other member of the Company Group to resign, not later than the Time
of Distribution, from all boards of directors or similar governing bodies
of Crane or any other member of
-16-
the Crane Group on which they serve, and from all positions as officers of
Crane or any other member of the Crane Group in which they serve, except as
otherwise specified on Schedule 3.6.
(b) Crane will cause each of its employees and each of the employees
of the other members of the Crane Group to revoke or withdraw their express
written authority, if any, to act on behalf of any Company Group entity as
an agent or representative therefor after the Time of Distribution. The
Company will cause each of its employees and each of the employees of the
other members of the Company Group to revoke or withdraw their express
written authority, if any, to act on behalf of any Crane Group entity as an
agent or representative therefor after the Time of Distribution.
Section 3.8 Rights Plan. Prior to the Time of Distribution, the
Company Board will adopt the Rights Plan and declare a dividend of the Rights so
that each share of Huttig Common Stock issued and outstanding as of the Time of
Distribution will initially have one Right attached thereto.
Section 3.9 Insurance.
(a) Coverage. Coverage of the Company and the Company Subsidiaries
under all Policies shall cease as of the Time of Distribution. From and
after the Time of Distribution, the Company and the Company Subsidiaries
will be responsible for obtaining and maintaining all insurance coverages
in their own right. All Policies will constitute Crane Retained Assets and
will be retained by Crane and the Crane Subsidiaries (with Crane and the
Crane Subsidiaries being the only named insureds thereunder), together with
all rights, benefits and privileges thereunder (including, without
limitation, the right to receive any and all return premiums with respect
thereto). The Company and the Company Subsidiaries will have no rights with
respect to any Policies, except that (i) the Company will have the right to
assert claims (and Crane will use reasonable best efforts to assist the
Company in asserting claims) for any loss, liability or damage with respect
to Huttig Assets under Policies with third-party insurers which are
"occurrence basis" Policies ("Occurrence Basis Policies") arising out of
insured incidents occurring from the date coverage thereunder first
commenced until the Time of Distribution to the extent that the terms and
conditions of any such Occurrence Basis Policies and agreements relating
thereto so allow and (ii) the Company will have the right to continue to
prosecute claims properly asserted with the insurance carrier prior to the
Time of Distribution (and Crane will use reasonable best efforts to assist
the Company in connection therewith) under Policies with third-party
insurers which are Policies written on a "claims made" basis ("Claims Made
Policies") arising out of insured incidents occurring from the date
coverage thereunder first commenced until the Time of Distribution to the
extent that the terms and conditions of any such Claims Made Policies and
agreements relating thereto so allow, provided that, in the case of both
clauses (i) and (ii) above, (A) all of Crane's and each Crane Subsidiary's
reasonable costs and expenses incurred in connection with the foregoing are
promptly paid by the Company, (B) Crane and the Crane Subsidiaries may, at
any time, without liability or obligation to the Company or any Company
Subsidiary (other than as set forth in Section 3.8(b)), amend,
-17-
commute, terminate, buy-out, extinguish liability under or otherwise modify
any Occurrence Basis Policies or Claims Made Policies (and such claims
shall be subject to any such amendments, commutations, terminations,
buy-outs, extinguishments and modifications), (C) such claims will be
subject to (and recovery thereon will be reduced by the amount of) any
applicable deductibles, retentions, self-insurance provisions or any
payment or reimbursement obligations of Crane, any Crane Subsidiary or any
Affiliate of Crane or any Crane Subsidiary in respect thereof and (D) such
claims will be subject to exhaustion of aggregate limits. Crane's
obligation to use reasonable best efforts to assist the Company in
asserting claims under Occurrence Basis Policies will include using
reasonable best efforts in assisting the Company to establish its right to
coverage under Occurrence Basis Policies (so long as all of Crane's costs
and expenses in connection therewith are promptly paid by the Company).
None of Crane or the Crane Subsidiaries will bear any Liability for the
failure of an insurance carrier to pay any claim under any Occurrence Basis
Policy or Claims Made Policy. It is understood that any Claims Made
Policies will not provide any coverage to the Company and the Company
Subsidiaries for any incident occurring prior to the Time of Distribution
but as to which a Claim is asserted with the insurance carrier after the
Time of Distribution, except and to the extent that coverage is provided
under discovery coverage purchased by the Company (at the Company's
expense) with respect to Crane's excess general liability Claims Made
Policies.
(b) Crane Actions. If Crane or any Crane Subsidiary proposes to amend,
commute, terminate, buy-out, extinguish liability under or otherwise modify
any Occurrence Basis Policies or Claims Made Policies under which the
Company has rights to assert claims pursuant to Section 3.9(a) in a manner
that would adversely affect any such rights of the Company, (i) Crane will
give the Company prior notice thereof and consult with the Company with
respect to such action (it being understood that the decision to take any
such action will be in the sole discretion of Crane) and (ii) Crane will
pay to the Company its equitable share (based on the amount of premiums
paid by or allocated to the Company in respect of the applicable Policy) of
any net proceeds actually received by Crane from the insurance carrier of
the applicable Policy as a result of such action by Crane (after deducting
Crane's reasonable costs and expenses incurred in connection with such
action).
(c) Administration. From and after the Time of Distribution:
(i) Crane will be responsible for the Claims Administration with
respect to claims of Crane and the Crane Subsidiaries under Occurrence
Basis Policies and Claims Made Policies; and
(ii) The Company or a Company Subsidiary, as appropriate, will be
responsible for the Claims Administration with respect to the claims
of the Company and the Company Subsidiaries under Occurrence Basis
Policies and Claims Made Policies.
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(d) Insurance Premiums.
(i) Crane will pay all premiums (retrospectively-rated or
otherwise) as required under the terms and conditions of the
respective Policies in respect of periods prior to the Time of
Distribution, whereupon the Company will upon receipt of evidence
thereof, forthwith reimburse Crane for that portion of such premiums
paid by Crane as are attributable to the Company.
(ii) In addition, Huttig will reimburse Crane for claims and
related expenses (paid by insurance carriers which are reimbursed by
Crane) for claims against Huttig arising out of an occurrence prior to
the time of Distribution. Crane will supply to Huttig evidence of such
claims and related expense in the manner provided in 3.9(d)(i) above.
(e) Agreement for Waiver of Conflict and Shared Defense. In the event
that an Occurrence Basis Policy or Claims Made Policy provides coverage for
both Crane and/or a Crane Subsidiary, on the one hand, and the Company
and/or a Company Subsidiary, on the other hand, relating to the same
occurrence, Crane and the Company agree to defend jointly and to waive any
conflict of interest necessary to the conduct of that joint defense.
Nothing in this Section 3.9(e) will be construed to limit or otherwise
alter in any way the indemnity obligations of the parties to this
Agreement, including, without limitation, those created by this Agreement,
by operation of law or otherwise.
(f) Directors' and Officers' Insurance. Crane will use its reasonable
best efforts to cause the persons currently serving as directors and/or
officers of Crane or any Subsidiary of Crane who will be or become,
effective as of the Time of Distribution, directors and/or officers of the
Company or any Company Subsidiary to be covered for a period of six years
from the Time of Distribution with respect to claims arising from facts or
events that occurred prior to the Time of Distribution by the directors'
and officers' liability insurance policies maintained by Crane during such
six-year period following the Time of Distribution for all persons who
served as directors and/or officers of Crane or any Crane Subsidiary prior
to the Time of Distribution.
Section 3.10 Use of Names, Trademarks, etc.
(a) From and after the Time of Distribution, Crane will have all
rights in and use of the name "Crane" and all corporate symbols and logos
related thereto and all derivatives thereof and the Company will have all
rights in and use of the name "Huttig" and all corporate symbols and logos
related thereto and all derivatives thereof. Prior to or promptly after the
Time of Distribution (but in no event later than 90 days after the
Distribution Date in the case of United States Persons and 180 days after
the Distribution Date in the case of non-United States Persons), the
Company will change the name of any Subsidiary or other Person under its
control to eliminate therefrom the name "Crane" and all derivatives thereof
and Crane will change the name of any Subsidiary or other Person under its
control to eliminate therefrom the name "Huttig" and all derivatives
thereof.
(b) From and after the Time of Distribution, the Company Group will
not use or have any rights to the name "Crane" or any derivatives thereof
or any other trademark, trade
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name, service xxxx or logo of the Crane Group constituting Crane Assets, or
any corporate symbol or logo related thereto or to any thereof or any name
or xxxx which includes the words "Crane" or any derivative thereof or name
or xxxx confusingly similar thereto, or any special script, type font,
form, style, logo, design, device, trade dress or symbol used or possessed
by the Crane Group before or after the Time of Distribution which contains
the trademark, trade name or service xxxx "Xxxxx" or any derivative thereof
or any name or xxxx confusingly similar thereto and the Company Group will
not hold itself out as having any affiliation with the Crane Group.
(c) From and after the Time of Distribution, the Crane Group will not
use or have any rights to the name "Huttig" or any derivatives thereof or
any other trademark, trade name, service xxxx or logo of the Company Group
constituting Huttig Assets, or any corporate symbol or logo related thereto
or to any thereof or any name or xxxx which includes the words "Huttig" or
any derivative thereof or name or xxxx confusingly similar thereto, or any
special script, type font, form, style, logo, design, device, trade dress
or symbol used or possessed by the Company Group before or after the Time
of Distribution which contains the trademark, trade name or service xxxx
"Huttig" or any derivative thereof or any name or xxxx confusingly similar
thereto and the Crane Group will not hold itself out as having any
affiliation with the Company Group.
(d) The Company will not, and will cause each other member of the
Company Group not to, challenge or contest the validity of the trademarks,
trade names, corporate symbols or logos described in Section 3.10(b), the
registration thereof or the ownership thereof by the Crane Group. The
Company will not, and will cause each other member of the Company Group not
to, apply anywhere at any time for any registration as owner or exclusive
licensee of such trademarks, trade names, corporate symbols or logos. If,
notwithstanding the foregoing, any title or interest in or to the use of
any such trademarks, trade names, corporate symbols or logos in any
jurisdiction, or any goodwill incident thereto, the Company will, upon the
request of Crane, and for a nominal consideration of one dollar, assign or
cause to be assigned to Crane or any designee of Crane, all right, title
and interest in and to the use of such trademarks, trade names, corporate
symbols or logos in any and all jurisdictions, together with any goodwill
incident thereto.
(e) Crane will not, and will cause each other member of the Crane
Group not to, challenge or contest the validity of the trademarks, trade
names, corporate symbols or logos described in Section 3.10(c), the
registration thereof or the ownership thereof by the Company Group. Crane
will not, and will cause each other member of the Crane Group not to, apply
anywhere at any time for any registration as owner or exclusive licensee of
such trademarks, trade names, corporate symbols or logos. If,
notwithstanding the foregoing, any member of the Crane Group develops,
adopts or acquires, directly or indirectly, any right, title or interest in
or to the use of any such trademarks, trade names, corporate symbols or
logos in any jurisdiction, or any goodwill incident thereto, Crane will,
upon the request of the Company, and for a nominal consideration of one
dollar, assign or cause to be assigned to the Company or any designee of
the Company, all right, title and interest in and to the use of such
trademarks, trade names, corporate symbols or logos in any and all
jurisdictions, together with any goodwill incident thereto.
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(f) The Company will cause each member of the Company Group to comply
with the provisions of this Section 3.10 and Crane will cause such member
of the Crane Group to comply with the provisions of this Section 3.10.
Nothing in this Section 3.10 will prevent any member of the Crane Group
from enforcing the provisions of this Section 3.10 against any member of
the Company Group or any member of the Company Group from enforcing the
provisions of this Section 3.10 against any member of the Crane Group.
Section 3.11 Consents. Prior to and after the Distribution Date, Crane and
the Company will, and will cause their respective Subsidiaries to, use their
reasonable best efforts (as requested by the other party) to obtain, or to cause
to be obtained, all Consents and to resolve any impracticalities of assignments
or transfers necessary for the transfer of all Assets, Subsidiaries and
Liabilities contemplated to be transferred pursuant to this Article III;
provided, however, that none of Crane or the Company or their respective
Subsidiaries shall be obligated to pay any consideration or offer or grant any
financial accommodation in connection therewith. Anything contained herein to
the contrary notwithstanding, this Agreement shall not constitute an agreement
to assign any Contract, License or Asset if an assignment or attempted
assignment of the same without the Consent of any other party or parties thereto
or other required Consent would constitute a breach thereof or of any applicable
law or in any way impair the rights of any member of the Crane Group or the
Company Group thereunder. If any such Consent is not obtained or if an attempted
assignment would be ineffective or would impair any member of either Group's
rights under any such Contract, License or Asset so that the contemplated
assignee hereunder (the "Recipient Party") would not receive all such rights,
then (x) the party contemplated hereunder to assign such Contract, License or
Asset (the "Assigning Party") will use reasonable best efforts (it being
understood that such efforts shall not include any requirement of the Assigning
Party to pay any consideration or offer or grant any financial accommodation) to
provide or cause to be provided to the Recipient Party, to the extent permitted
by law, the benefits of any such Contract, License or Asset and the Assigning
Party will promptly pay or cause to be paid to the Recipient Party when received
all moneys and properties received by the Assigning Party with respect to any
such Contract, License or Asset and (y) the Recipient Party will pay, perform
and discharge on behalf of the Assigning Party all of the Assigning Party's
Liabilities thereunder in a timely manner and in accordance with the terms
thereof. In addition, the Assigning Party will take such other actions (at the
Recipient Party's expense) as may reasonably be requested by the Recipient Party
in order to place the Recipient Party, insofar as reasonably possible, in the
same position as if such Contract, License or Asset had been transferred as
contemplated hereby and so all the benefits and burdens relating thereto,
including, without limitation, possession, use, risk of loss, potential for gain
and dominion, control and command, shall inure to the Recipient Party. If and
when such Consents are obtained, the transfer of the applicable Contract,
License or Asset shall be effected as promptly following the Time of
Distribution as shall be practicable in accordance with the terms of this
Agreement. To the extent that any transfers and assumptions contemplated by this
Article III shall not have been consummated on or prior to the Time of
Distribution, the parties shall cooperate to effect such transfers as promptly
following the Time of Distribution as shall be practicable, it nonetheless being
agreed and understood by the parties that neither party shall be liable in any
manner to the other party for any failure of any of the transfers contemplated
by this Article III to be consummated prior to the Time of Distribution.
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ARTICLE IV
MUTUAL RELEASE; INDEMNIFICATION
Section 4.1 Mutual Release. Effective as of the Time of Distribution and
except as otherwise specifically set forth in the Transaction Agreements, each
of Crane, on the one hand, and the Company, on the other hand, on its own behalf
and on behalf of each of its respective Subsidiaries, hereby releases and
forever discharges the other and its Subsidiaries, and its and their respective
officers, directors, agents, Affiliates, record and beneficial security holders
(including, without limitation, trustees and beneficiaries of trusts holding
such securities), advisors and Representatives (in their respective capacities
as such) and their respective heirs, executors, administrators, successors and
assigns, of and from all debts, demands, actions, causes of action, suits,
accounts, covenants, contracts, agreements, damages, claims and Liabilities
whatsoever of every name and nature, both in law and in equity, that the
releasing party has or ever had, that arise out of or relate to events,
circumstances or actions taken by such other party or any conditions existing at
or prior to the Time of Distribution; provided, however, that the foregoing
general release shall not apply to (i) any Liabilities (including, without
limitation, Liabilities with respect to indemnification or contribution) under
the Transaction Agreements or assumed, transferred, assigned, allocated or
arising under any of the Transaction Agreements (including, without limitation,
any Liability that the parties may have with respect to indemnification or
contribution pursuant to any Transaction Agreement for claims brought against
the parties by third Persons) and will not affect any party's right to enforce
the Transaction Agreements in accordance with their terms, (ii) any Liability
arising from or relating to any agreement, arrangement, commitment or
undertaking described in Section 3.4(b)(ii) (including, without limitation,
Ordinary Course Intercompany Arrangements) or (iii) any Liability the release of
which would result in the release of any Person other than a Person released
pursuant to this Section 4.1 (provided that the parties agree not to bring suit
or permit any of their Subsidiaries to bring suit against any Person with
respect to any Liability to the extent such Person would be released with
respect to such Liabilities by this Section 4.1 but for this clause (iii)).
Section 4.2 Indemnification by Crane. Except as otherwise specifically
provided in any Transaction Agreement and subject to the provisions of this
Article IV, Crane shall indemnify, defend and hold harmless the Huttig
Indemnitees from and against, and pay or reimburse, as the case may be, the
Huttig Indemnitees for, all Indemnifiable Losses, as incurred or suffered by any
Huttig Indemnitee based upon, arising out of, relating to or otherwise in
connection with:
(a) businesses of Crane, the Crane Subsidiaries and their respective
predecessors (other than the Building Products Business) engaged in at or
prior to the Time of Distribution, the Crane Assets or Liabilities of Crane
or any Crane Subsidiary as of the Time of Distribution which are not Huttig
Liabilities (including, without limitation, the failure by Crane or any
other member of the Crane Group to pay, perform or otherwise discharge such
Liabilities
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in accordance with their terms), whether such Indemnifiable Losses are
based upon, arise out of or relate to or are otherwise in connection with
events, occurrences, actions, omissions, facts, circumstances or conditions
occurring, existing or asserted before, at or after the Time of
Distribution;
(b) any untrue statement or alleged untrue statement of a material
fact contained in the sections of the Form 10 listed on Schedule 4.2, or
any omission or alleged omission to state in such sections a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
but only in each case with respect to information relating to the Crane
Group provided by Crane expressly for use in the sections of the Form 10
listed on Schedule 4.2;
(c) the breach by any member of the Crane Group of any agreement or
covenant contained in a Transaction Agreement which does not by its express
terms expire at the Time of Distribution; or
(d) the enforcement by the Huttig Indemnitees of their rights to be
indemnified, defended and held harmless under this Agreement.
Section 4.3 Indemnification by the Company. Except as otherwise
specifically provided in any Transaction Agreement and subject to the provisions
of this Article IV, the Company and the Company Subsidiaries shall indemnify,
defend and hold harmless the Crane Indemnitees from and against, and pay or
reimburse, as the case may be, the Crane Indemnitees for, all Indemnifiable
Losses, as incurred, suffered by any Crane Indemnitee based upon, arising out
of, relating to or otherwise in connection with:
(a) the Building Products Business, the Huttig Assets or the Huttig
Liabilities (including, without limitation, (i) any guarantees or
obligations to assure performance or perform given or made by, or other
Liabilities of, Crane or any Crane Subsidiary with respect to the Building
Products Business, and (ii) the failure by the Company or any other member
of the Company Group to pay, perform or otherwise discharge Huttig
Liabilities in accordance with their terms, whether such Indemnifiable
Losses are based upon, arise out of or relate to or are otherwise in
connection with events, occurrences, actions, omissions, facts,
circumstances or conditions occurring, existing or asserted before, at or
after the Time of Distribution;
(b) any untrue statement or alleged untrue statement of a material
fact contained in the Form 10, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, except in each case with respect to information
relating to the Crane Group provided by Crane expressly for use in the
sections of the Form 10 listed on Schedule 4.2;
(c) the breach by any member of the Company Group of any agreement or
covenant contained in a Transaction Agreement which does not by its express
terms expire at the Time of Distribution;
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(d) any Action or other claim alleging that any Liability was
improperly allocated to the Company Group or that any Asset was improperly
withheld from the Company Group, in each case pursuant to any of the
Transaction Agreements; or
(e) the enforcement by the Crane Indemnitees of their rights to be
indemnified, defended and held harmless under this Agreement.
Section 4.4 Limitations on Indemnification Obligations.
(a) The amount that any party (an "Indemnifying Party") is or may be
required to pay to an Indemnitee in respect of Indemnifiable Losses or
other Liability for which indemnification is provided under this Agreement
shall be reduced by any amounts actually received (including, without
limitation, Insurance Proceeds actually received) by or on behalf of such
Indemnitee (net of increased insurance premiums and charges related
directly and solely to the related Indemnifiable Losses and costs and
expenses (including, without limitation, reasonable legal fees and
expenses) incurred by such Indemnitee in connection with seeking to collect
and collecting such amounts) in respect of such Indemnifiable Losses or
other Liability (such net amounts are referred to herein as "Indemnity
Reduction Amounts"). If any Indemnitee receives any Indemnity Reduction
Amounts in respect of an Indemnifiable Loss for which indemnification is
provided under this Agreement after the full amount of such Indemnifiable
Loss has been paid by an Indemnifying Party or after an Indemnifying Party
has made a partial payment of such Indemnifiable Loss and such Indemnity
Reduction Amounts exceed the remaining unpaid balance of such Indemnifiable
Loss, then the Indemnitee shall promptly remit to the Indemnifying Party an
amount equal to the excess (if any) of (A) the amount theretofore paid by
the Indemnifying Party in respect of such Indemnifiable Loss, less (B) the
amount of the indemnity payment that would have been due if such Indemnity
Reduction Amounts in respect thereof had been received before the indemnity
payment was made. An insurer or other third party who would otherwise be
obligated to pay any claim shall not be relieved of the responsibility with
respect thereto or, solely by virtue of the indemnification provisions
hereof, have any subrogation rights with respect thereto, it being
expressly understood and agreed that no insurer or any other third party
shall be entitled to any benefit they would not be entitled to receive in
the absence of the indemnification provisions by virtue of the
indemnification provisions hereof.
(b) In determining the amount of any Indemnifiable Losses, such amount
shall be (i) reduced to take into account any net Tax benefit realized by
the Indemnitee arising from the incurrence or payment by the Indemnitee of
such Indemnifiable Losses and (ii) increased to take into account any net
Tax cost incurred by the Indemnitee as a result of the receipt or accrual
of payments hereunder (grossed-up for such increase), in each case
determined by treating the Indemnitee as recognizing all other items of
income, gain, loss, deduction or credit before recognizing any item arising
from such Indemnifiable Losses.
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Section 4.5 Procedures Relating to Indemnification.
(a) If a claim or demand is made against an Indemnitee, or an
Indemnitee shall otherwise learn of an assertion, by any Person who is not
a party to this Agreement (or an Affiliate thereof) as to which an
Indemnifying Party may be obligated to provide indemnification pursuant to
this Agreement (a "Third Party Claim"), such Indemnitee will notify the
Indemnifying Party in writing, and in reasonable detail, of the Third Party
Claim reasonably promptly (and in any event within 20 business days) after
becoming aware of such Third Party Claim; provided, however, that failure
to give such notification will not affect the indemnification provided
hereunder except to the extent the Indemnifying Party shall have been
actually prejudiced as a result of such failure (except that the
Indemnifying Party will not be liable for any expenses incurred during the
period in which the Indemnitee failed to give such notice). Thereafter, the
Indemnitee will deliver to the Indemnifying Party, promptly after the
Indemnitee's receipt thereof, copies of all notices and documents
(including, without limitation, court papers) received or transmitted by
the Indemnitee relating to the Third Party Claim.
(b) If a Third Party Claim is made against an Indemnitee, the
Indemnifying Party will be entitled to participate in or to assume the
defense thereof (in either case, at the expense of the Indemnifying Party)
with counsel selected by the Indemnifying Party and reasonably satisfactory
to the Indemnitee. Should the Indemnifying Party so elect to assume the
defense of a Third Party Claim, the Indemnifying Party will not be liable
to the Indemnitee for any legal or other expenses subsequently incurred by
the Indemnitee in connection with the defense thereof; provided that, if in
the Indemnitee's reasonable judgment a conflict of interest exists in
respect of such claim or if the Indemnifying Party shall have assumed
responsibility for such claim with any reservations or exceptions, such
Indemnitee will have the right to employ separate counsel reasonably
satisfactory to the Indemnifying Party to represent such Indemnitee and in
that event the reasonable fees and expenses of such separate counsel (but
not more than one separate counsel for all Indemnitees similarly situated)
shall be paid by such Indemnifying Party. If the Indemnifying Party assumes
the defense of any Third Party Claim, the Indemnitee will have the right to
participate in the defense thereof and to employ counsel, at its own
expense, separate from the counsel employed by the Indemnifying Party, it
being understood that the Indemnifying Party will control such defense. The
Indemnifying Party will be liable for the fees and expenses of counsel
employed by the Indemnitee for any period during which the Indemnifying
Party has failed to assume the defense thereof (other than during any
period in which the Indemnitee shall have failed to give notice of the
Third Party Claim as provided above). If the Indemnifying Party assumes the
defense of any Third Party Claim, the Indemnifying Party will promptly
supply to the Indemnitee copies of all correspondence and documents
relating to or in connection with such Third Party Claim and keep the
Indemnitee fully informed of all developments relating to or in connection
with such Third Party Claim (including, without limitation, providing to
the Indemnitee on request updates and summaries as to the status thereof).
If the Indemnifying Party chooses to defend a Third Party Claim, the
parties hereto will cooperate in the defense thereof (such cooperation to
be at the expense, including, without limitation, reasonable legal fees and
expenses, of the Indemnifying Party), which cooperation shall include the
retention in accordance with this Agreement and (upon the Indemnifying
Party's request) the provision to the Indemnifying Party of records and
information that are reasonably relevant to such Third Party Claim, and
making employees available on a
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mutually convenient basis to provide additional information and explanation
of any material provided hereunder.
(c) No Indemnifying Party will consent to any settlement, compromise
or discharge (including the consent to entry of any judgment) of any Third
Party Claim without the Indemnitee's prior written consent (which consent
will not be unreasonably withheld); provided, that if the Indemnifying
Party assumes the defense of any Third Party Claim, the Indemnitee will
agree to any settlement, compromise or discharge of such Third Party Claim
that the Indemnifying Party may recommend and that by its terms obligates
the Indemnifying Party to pay the full amount of Indemnifiable Losses in
connection with such Third Party Claim and unconditionally and irrevocably
releases the Indemnitee completely from all Liability in connection with
such Third Party Claim; provided, however, that the Indemnitee may refuse
to agree to any such settlement, compromise or discharge (x) that provides
for injunctive or other nonmonetary relief affecting the Indemnitee or (y)
that, in the reasonable opinion of the Indemnitee, would otherwise
materially adversely affect the Indemnitee. Whether or not the Indemnifying
Party shall have assumed the defense of a Third Party Claim, the Indemnitee
will not (unless required by law) admit any liability with respect to, or
settle, compromise or discharge, such Third Party Claim without the
Indemnifying Party's prior written consent (which consent will not be
unreasonably withheld).
(d) Any claim on account of Indemnifiable Losses that does not involve
a Third Party Claim will be asserted by reasonably prompt written notice
given by the Indemnitee to the Indemnifying Party from whom such
indemnification is sought. The failure by any Indemnitee so to notify the
Indemnifying Party will not relieve the Indemnifying Party from any
liability that it may have to such Indemnitee under this Agreement, except
to the extent that the Indemnifying Party shall have been actually
prejudiced by such failure. Any notice pursuant to this Section 4.5(d) will
contain a statement, in prominent and conspicuous type, that if the
Indemnifying Party does not dispute its liability to the Indemnitee with
respect to the claim made in such notice by notice to the Indemnitee prior
to the expiration of a 30-calendar-day period following the Indemnifying
Party's receipt of the second notice of such claim, the claim shall be
conclusively deemed a liability of the Indemnifying Party. If the
Indemnitee has provided the Indemnifying Party two such notices not less
than 30 days apart and the Indemnifying Party does not notify the
Indemnitee prior to the expiration of a 30-calendar-day period following
its receipt of the second such notice that the Indemnifying Party disputes
its liability to the Indemnitee under this Agreement, such claim specified
by the Indemnitee in such notice will be conclusively deemed a liability of
the Indemnifying Party under this Agreement and the Indemnifying Party will
pay the amount of such liability to the Indemnitee on demand or, in the
case of any notice in which the amount of the claim (or any portion
thereof) is estimated, on such later date when the amount of such claim (or
such portion thereof) becomes finally determined. If the Indemnifying Party
has timely disputed its liability with respect to such claim, as provided
above, the Indemnifying Party and the Indemnitee will proceed in good faith
to negotiate a resolution of such dispute and, if not resolved through
negotiations by the 120th day after notice of such claim was given to the
Indemnifying Party, the Indemnifying Party and the Indemnitee will be free
to pursue such remedies as may be available to such parties under this
Agreement or under applicable law.
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(e) In the event of payment in full by an Indemnifying Party to any
Indemnitee in connection with any Third Party Claim, such Indemnifying
Party will be subrogated to and shall stand in the place of such Indemnitee
as to any events or circumstances in respect of which such Indemnitee may
have any right or claim relating to such Third Party Claim against any
claimant or plaintiff asserting such Third Party Claim or against any other
Person. Such Indemnitee will cooperate with such Indemnifying Party in a
reasonable manner, and at the cost and expense of such Indemnifying Party,
in prosecuting any subrogated right or claim.
Section 4.6 Remedies Cumulative. The remedies provided in this Article IV
shall be cumulative and shall not preclude assertion by any Indemnitee of any
other rights or the seeking of any and all other remedies against any
Indemnifying Party.
Section 4.7 Survival of Indemnities. The obligations of each of Crane and
the Company under this Article IV will not terminate at any time and will
survive the sale or other transfer by any party of any assets or businesses or
the assignment by any party of any Liabilities with respect to any Indemnifiable
Losses of the other related to such assets, businesses or Liabilities.
Section 4.8 Exclusivity of Tax Allocation Agreement. Notwithstanding
anything in this Agreement to the contrary and except as provided in the
Exchange Agreement, the Tax Allocation Agreement will be the exclusive agreement
among the parties with respect to all Tax matters, including, without
limitation, indemnification in respect of Tax matters.
ARTICLE V
ACCESS TO INFORMATION
Section 5.1 Access to Information. From and after the Time of Distribution,
Crane will, and will cause each Crane Subsidiary to, afford to the Company and
its Representatives (at the Company's expense) reasonable access and duplicating
rights during normal business hours and upon reasonable advance notice to all
Information within Crane's possession or control or in the possession or control
of a Crane Subsidiary relating to the Company, any Company Subsidiary or the
Building Products Business, insofar as such access is reasonably required by the
Company or any Company Subsidiary, subject to the provisions below regarding
Privileged Information. From and after the Time of Distribution, the Company
will, and will cause each Company Subsidiary to, afford to Crane and its
Representatives (at Crane's expense) reasonable access and duplicating rights
during normal business hours and upon reasonable advance notice to all
Information within the Company's possession or control or in the possession or
control of a Company Subsidiary relating to Crane, any Crane Subsidiary or the
businesses of the Pre-Distribution Group, insofar as such access is reasonably
required by Crane or any Crane Subsidiary, subject to the provisions below
regarding Privileged Information. Without limiting the foregoing, Information
may be requested under this Article V for audit, accounting, claims, litigation,
insurance, environmental and safety and tax purposes, as well as for purposes of
fulfilling disclosure and reporting obligations and for performing this
Agreement and the transactions contemplated hereby.
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In furtherance of the foregoing:
(a) Each party acknowledges that (i) each of Crane and the Company
(and the members of the Crane Group and the Company Group, respectively)
has or may obtain Privileged Information; (ii) there are a number of
Actions affecting one or more of the members of the Crane Group and the
Company Group; (iii) the parties may have a common legal interest in
Actions, in the Privileged Information, and in the preservation of the
confidential status of the Privileged Information, in each case relating to
the business of the Crane Group or the Company Group; and (iv) both Crane
and the Company intend that the transactions contemplated by the
Transaction Agreements and any transfer of Privileged Information in
connection therewith shall not operate as a waiver of any potentially
applicable privilege.
(b) Each of Crane and the Company agrees, on behalf of itself and each
member of the Group of which it is a member, not to disclose or otherwise
waive any privilege attaching to any Privileged Information relating to the
business of the Company Group or the Crane Group, respectively, without
providing prompt written notice to and obtaining the prior written consent
of the other, which consent will not be unreasonably withheld. In the event
of a disagreement between any member of the Crane Group and any member of
the Company Group concerning the reasonableness of withholding such
consent, no disclosure will be made prior to a final, nonappealable
resolution of such disagreement.
(c) Upon any member of the Crane Group or any member of the Company
Group receiving any subpoena or other compulsory disclosure notice from a
court, other Governmental Entity or otherwise that requests disclosure of
Privileged Information, in each case relating to the business of the
Company Group or the Crane Group, respectively, the recipient of the notice
will promptly provide to the other party (following the notice provisions
set forth herein) a copy of such notice, the intended response, and all
materials or information relating to the other Group that might be
disclosed. In the event of a disagreement as to the intended response or
disclosure, unless and until the disagreement is resolved as provided in
Section 5.1(b), the parties will cooperate to assert all defenses to
disclosure claimed by either Group, at the cost and expense of the Group
claiming such defense to disclosure, and shall not disclose any disputed
documents or information until all legal defenses and claims of privilege
have been finally determined.
Section 5.2 Production of Witnesses. Subject to Section 5.1, after the Time
of Distribution, each of Crane and the Company will, and will cause each member
of the Crane Group and the Company Group, respectively, to, make available to
the other party and its Subsidiaries, upon written request and at the cost and
expense of the party so requesting, its officers, employees and agents as
witnesses to the extent that any such Person may reasonably be required (giving
consideration to business demands of such Representatives) in connection with
any Actions or other proceedings in which the requesting party may from time to
time be involved, provided that the same shall not unreasonably interfere with
the conduct of business by the Group of which the request is made.
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Section 5.3 Retention of Records. Except as otherwise required by law or
agreed to in writing, if any Information relating to the business, assets or
Liabilities of a member of a Group is retained by a member of the other Group,
each of Crane and the Company will, and will cause the members of the Group of
which it is a member to, retain for the period required by the applicable Crane
records retention policy in effect immediately prior to the Time of Distribution
all such Information in such Group's possession or under its control. In
addition, after the expiration of such required retention period, if any member
of either Group wishes to destroy or dispose of any such Information, prior to
destroying or disposing of any of such Information, (1) Crane or the Company, on
behalf of the member of its Group that is proposing to dispose of or destroy any
such Information, will provide no less than 30 days' prior written notice to the
other party, specifying in reasonable detail the Information proposed to be
destroyed or disposed of, and (2) if, prior to the scheduled date for such
destruction or disposal, the recipient of such notice requests in writing that
any of the Information proposed to be destroyed or disposed of be delivered to
such requesting party, the party whose Group is proposing to dispose of or
destroy such Information promptly will arrange for the delivery of the requested
Information to a location specified by, and at the expense of, the requesting
party.
Section 5.4 Confidentiality. Subject to Section 5.1, which shall govern
Privileged Information, from and after the Time of Distribution, each of Crane
and the Company shall hold, and shall use reasonable efforts to cause its
Affiliates and Representatives to hold, in strict confidence all Information
concerning the other party's Group in its possession or control or furnished to
it by such other party's Group pursuant to the Transaction Agreements or the
transactions contemplated thereby and will not release or disclose such
Information to any other Person, except its Affiliates and Representatives, who
will be bound by the provisions of this Section 5.4; provided, however, that any
member of the Crane Group or the Company Group may disclose such Information to
the extent that (a) disclosure is compelled by judicial or administrative
process or, in the opinion of such Person's counsel, by other requirements of
law (in which case the party required to make such disclosure will notify the
other party as soon as practicable of such obligation or requirement and
cooperate with the other party to limit the Information required to be disclosed
and to obtain a protective order or other appropriate remedy with respect to the
Information ultimately disclosed), or (b) such Person can show that such
Information was (i) available to such Person on a nonconfidential basis (other
than from a member of the other party's Group) prior to its disclosure by such
Person, (ii) in the public domain through no fault of such Person or (iii)
lawfully acquired by such Person from another source after the time that it was
furnished to such Person by the other party's Group, and not acquired from such
source subject to any confidentiality obligation on the part of such source
known to the acquirer, or on the part of the acquirer. Each party acknowledges
that it will be liable for any breach of this Section 5.4 by its Representatives
to whom such Information is disclosed by such party. Notwithstanding the
foregoing, each of Crane and the Company will be deemed to have satisfied its
obligations under this Section 5.4 with respect to any
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Information (other than Privileged Information) if it exercises the same care
with regard to such Information as it takes to preserve confidentiality for its
own similar Information.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Entire Agreement; Construction. This Agreement, the Ancillary
Agreements and the Exchange Agreement, including, without limitation, any
annexes, schedules and exhibits hereto or thereto, and other agreements and
documents referred to herein and therein, will together constitute the entire
agreement between the parties with respect to the subject matter hereof and
thereof and will supersede all prior negotiations, agreements and understandings
of the parties of any nature, whether oral or written, with respect to such
subject matter. Notwithstanding any other provisions in the Transaction
Agreements to the contrary, in the event and to the extent that there is a
conflict between the provisions of this Agreement and the provisions of the
Employee Matters Agreement or the Tax Allocation Agreement, the provisions of
the Employee Matters Agreement or the Tax Allocation Agreement, as appropriate,
will control.
Section 6.2 Survival of Agreements. Except as otherwise contemplated by the
Transaction Agreements, all covenants and agreements of the parties contained in
the Transaction Agreements will remain in full force and effect and survive the
Time of Distribution.
Section 6.3 Expenses. Except as otherwise set forth in any Transaction
Agreement and the Exchange Agreement, all costs and expenses incurred through
the Time of Distribution in connection with the Distribution, the preparation,
execution and delivery of the Transaction Agreements and the consummation of the
transactions contemplated thereby will be charged to and paid by Crane (other
than (i) the costs and expenses of the Company's credit facilities and other
financings and (ii) costs and expenses to the extent the same relate to
operations of the Building Products Business (whether the costs and expenses
described in clauses (i) or (ii) are incurred and/or paid before, at or after
the Time of Distribution), which costs and expenses described in clauses (i) and
(ii) will be charged to and paid by the Company). Except as otherwise set forth
in any Transaction Agreement or the Exchange Agreement, all costs and expenses
incurred following the Time of Distribution in connection with implementation of
the transactions contemplated by the Transaction Agreements will be charged to
and paid by the party for whose benefit the expenses are incurred, with any
expenses that cannot be allocated on such basis to be split equally between the
parties.
Section 6.4 Governing Law. This Agreement will be governed by and construed
in accordance with the internal laws of the State of Delaware applicable to
contracts made and to be performed entirely within such State, without regard to
the conflicts of law principles of such State.
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Section 6.5 Notices. All notices, requests, claims, demands and other
communications required or permitted to be given hereunder will be in writing
and will be delivered by hand or telecopied or sent, postage prepaid, by
registered, certified or express mail or reputable overnight courier service and
will be deemed given when so delivered by hand or telecopied, or three business
days after being so mailed (one business day in the case of express mail or
overnight courier service). All such notices, requests, claims, demands and
other communications will be addressed as set forth below, or pursuant to such
other instructions as may be designated in writing by the party to receive such
notice:
(a) If to Crane:
Crane Co.
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Secretary
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx Xxxxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
(b) If to the Company:
Huttig Building Products, Inc.
00000 Xxxxx Xxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxxxx, XX 00000
Attention: President
Telecopy: (000) 000-0000
Section 6.6 Consent to Jurisdiction. Each of Crane and the Company
irrevocably submits to the exclusive jurisdiction of (i) the Court of Chancery
in and for the State of Delaware and the Superior Court in and for the State of
Delaware and (ii) the United States District Court for the District of Delaware,
for the purposes of any suit, action or other proceeding arising out of the
Transaction Agreements or any transaction contemplated thereby (and agrees not
to commence any action, suit or proceeding relating thereto except in such
courts). Each of Crane and the Company further agrees that service of any
process, summons, notice or document hand delivered or sent by U.S. registered
mail to such party's respective address set forth in Section 6.5 will be
effective service of process for any action, suit or proceeding in Delaware with
respect to any matters to which it has submitted to jurisdiction as set forth in
the immediately preceding
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sentence. Each of Crane and the Company irrevocably and unconditionally waives
any objection to the laying of venue of any action, suit or proceeding arising
out of the Transaction Agreements or the transactions contemplated thereby in
(i) the Court of Chancery in and for the State of Delaware and the Superior
Court in and for the State of Delaware or (ii) the United States District Court
for the District of Delaware, and hereby further irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum.
Section 6.7 Amendments. This Agreement cannot be amended, modified or
supplemented except by a written agreement executed by Crane and the Company.
Section 6.8 Assignment. Neither party to this Agreement will convey, assign
or otherwise transfer any of its rights or obligations under this Agreement
without the prior written consent of the other party in its sole and absolute
discretion, except that other than as expressly provided herein any party may
(without obtaining any consent) assign any of its rights hereunder to a
successor to all or substantially all of its business. Any such conveyance,
assignment or transfer requiring the prior written consent of another party
which is made without such consent will be void ab initio. No assignment of this
Agreement will relieve the assigning party of its obligations hereunder.
Section 6.9 Captions; Currency. The article, section and paragraph captions
herein and the table of contents hereto are for convenience of reference only,
do not constitute part of this Agreement and will not be deemed to limit or
otherwise affect any of the provisions hereof. Unless otherwise specified, all
references herein to numbered articles or sections are to articles and sections
of this Agreement and all references herein to annexes or schedules are to
annexes and schedules to this Agreement. Unless otherwise specified, all
references contained in this Agreement, in any annex or schedule referred to
herein or in any instrument or document delivered pursuant hereto to dollars or
"$" shall mean United States Dollars.
Section 6.10 Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
party as a result thereof, the parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the parties.
Section 6.11 Parties in Interest. This Agreement is binding upon and is for
the benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement is not made for the benefit of any Person not a party
hereto, and no Person other than the parties hereto or their respective
successors and permitted assigns will acquire or have any benefit, right, remedy
or claim under or by reason of this Agreement,
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except that the provisions of Sections 4.2 and 4.3 hereof shall inure to the
benefit of the Persons referred to therein.
Section 6.12 Schedules. All annexes and schedules attached hereto are
hereby incorporated in and made a part of this Agreement as if set forth in full
herein. Capitalized terms used in the schedules hereto but not otherwise defined
therein will have the respective meanings assigned to such terms in this
Agreement.
Section 6.13 Termination. Subject to the provisions of the Exchange
Agreement, this Agreement may be terminated and the Distribution abandoned at
any time prior to the Time of Distribution by and in the sole discretion of the
Crane Board without the approval of the Company or of Crane's stockholders. In
the event of such termination, no party will have any liability of any kind to
any other party on account of such termination other than as provided in the
Exchange Agreement.
Section 6.14 Waivers; Remedies. The conditions to Crane's obligation to
consummate the Distribution are for the sole benefit of Crane and may be waived
in writing by Crane in whole or in part in Crane's sole discretion. No failure
or delay on the part of either Crane or the Company in exercising any right,
power or privilege hereunder will operate as a waiver thereof, nor will any
waiver on the part of either Crane or the Company of any right, power or
privilege hereunder operate as a waiver of any other right, power or privilege
hereunder, nor will any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder. The rights and
remedies herein provided are cumulative and are not exclusive of any rights or
remedies which the parties may otherwise have at law or in equity.
Section 6.15 Further Assurances. From time to time after the Distribution,
as and when requested by either party hereto, the other party shall execute and
deliver, or cause to be executed and delivered, all such documents and
instruments and shall take, or cause to be taken, all such actions as the
requesting party may reasonably request to consummate the transactions
contemplated by the Transaction Agreements.
Section 6.16 Counterparts. This Agreement may be executed in separate
counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts will together constitute the same agreement.
Section 6.17 Performance. Each party will cause to be performed and hereby
guarantees the performance of all actions, agreements and obligations set forth
herein to be performed by any Subsidiary or Affiliate of such party.
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by
the duly authorized officers of the parties as of the date first above written.
CRANE CO.
By:
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Name:
Title:
HUTTIG BUILDING PRODUCTS, INC.
By:
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Name:
Title:
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